The Distribution of Talent and the Pattern and Consequences of International Trade

By Gene M. Grossman. Journal of Political Economy, 2004

161 citations recorded by the source corpus.

I study the interaction between imperfect labor contracts and international trade in a setting in which workers have private information about their own abilities. When an individual’s contribution to firm output can be measured accurately in some activities but not in others, the most able workers select occupations in which their pay most closely reflects their own performance. In a world economy with two otherwise similar countries that have different distributions of talent, the country with the more heterogeneous labor force exports the good that is produced by the most talented individuals. In this country, trade exacerbates the “polarization” of the labor force and often worsens the distribution of income.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/9a4fd59ba605b94aada656e08a75457b6c0d9873

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Citations in the corpus

An Elementary Theory of Global Supply Chains (2011, methodology): “…also related to a growing literature using assignment or matching models in an international context; see, for example, Grossman and Maggi (2000), Grossman (2004), Yeaple (2005), Ohnsorge and Tre er (2007), Blanchard and Willmann (2010), Nocke and Yeaple (2008), Costinot (2009), and Costinot and…”
A Supply and Demand Framework for Two-Sided Matching Markets (2016, unknown): “…educational attainment, changes in chief executive officer wages, and the relationship between the distribution of talent and international trade (see Grossman 2004; Gabaix and Landier 2008; Terviö 2008; Chiappori, Iyigun, andWeiss 2009;Galichon,Kominers, and Weber 2016; Bojilov and Galichon 2016).”
On the origins of comparative advantage (2009, background): “” This assessment of the trade–theory literature by Grossman and Helpman (1995) appears as relevant today as it was a decade ago. While our understanding of the relationship between technological progress and trade has considerably improved, we still know little about the determinants of productivit”
Strategic immigration policies and welfare in heterogeneous countries (2003, unknown): “) The nature of knowledge production indicates the importance of interaction between different workers and, especially, complementarity of their talents and skills, that is quite different from the multi-stage technological process in high-precision manufacturing (see Milgrom and Roberts (1990) and ”
Domestic Institutions as a Source of Comparative Advantage (2013, unknown): “These include Grossman and Maggi (2000), Grossman (2004), Ohnsorge and Trefler (2007), and Bombardini,”
Sorting It Out: International Trade with Heterogeneous Workers (2007, background): “For example, Japanese comparative advantage in goods involving long chains of production and re- 1 Leamer (1999), Grossman and Maggi (2000), and Grossman (2004) are recent prominent studies that feature trade models of worker sorting, but the sorting and hence the predictions are very different…”